Law Firm Drops Willamette Request

Published
7:00 pm EST, Tuesday, January 15, 2002

In a flurry of legal papers, a law firm representing shareholders of Willamette Industries Inc. filed and then withdrew a temporary restraining order request on Wednesday that sought to block any deal to buy a Georgia-Pacific Corp. division.

U.S. District Judge Anna Brown had scheduled a hearing Thursday on the injunction request filed by the San Diego office of Milberg Weiss Bershad Hynes & Lerach, a law firm that specializes in shareholder class-action suits.

But by lunch time Wednesday, the request had been withdrawn, according to a court clerk.

Willamette is battling a $6 billion hostile takeover bid by rival Weyerhaeuser Co. that began in November 2000. Weyerhaeuser Chairman Steven Rogel, who left the top job at Willamette in 1997, has said any deal with Georgia-Pacific would end the takeover bid.

Calls to the lawyer handling the case were not immediately returned.

But the firm said in a statement that it filed the injunction request to temporarily prevent the Willamette board of directors "and anyone acting in concert with them from entering into a business combination with Georgia-Pacific."

Documents filed in support of the request included a solicitation and recommendation statement Willamette filed Nov. 27 with the Securities and Exchange Commission.

The statement, signed by Willamette CEO Duane McDougall, indicated that Willamette had outperformed Weyerhaeuser in a number of areas, including a better return on invested capital, average equity and average assets.

The statement filed with the SEC also contained a "hostile takeover update" that accused Weyerhaeuser of dragging its feet and refusing to negotiate a higher price based on the comparative financial data.

"We opened the door for them in October when we sent a letter indicating that we would sit down with them again if they made an offer in the high $50s," the Willamette statement to the SEC said.

"In order to help them with their valuation, we even made our investment bankers available to discuss alternatives and provide information. Well, Weyerhaeuser slammed that door shut that very same day. … In the end, Weyerhaeuser knows very well what this company is worth."

Willamette said last month it had opened talks with Georgia-Pacific for its building products division, just as Rogel made what he said was his "absolutely final" offer of $55 a share for Willamette.

Rogel has been trying to buy Portland-based Willamette ever since he left to become the first outsider to head Weyerhaeuser in the century since it was founded. He announced the hostile takeover bid after the Willamette board repeatedly rejected his offers.

Weyerhaeuser spokesman Bruce Amundson said the company had no comment on the temporary restraining order request and its withdrawal.

Willamette spokeswoman Jackie Lang called the request "uninformed and without merit" and said negotiations with Georgia-Pacific remained open.

The request listed a Willamette shareholder, Wayne C. Van Zwoll, as a plaintiff but there was no telephone listing for him.